There are fears that hundreds of jobs could be lost at Haribo in West Yorkshire.
The confectionery company, which has factories in Pontefract and Castleford, has confirmed it has begun discussions with staff about proposals to "protect the long-term future of Haribo manufacturing" in the UK.
Jon Hughes, managing director of Haribo UK, said the proposals were in response to demands from rising costs and a competitive market.
We must respond to significant rising costs and the demands of a highly competitive market. None of these proposals are taken lightly. They are driven by the need to secure a sustainable future that will safeguard our proud heritage in Yorkshire and enable continued investment in our people and brands
He added: "Our priority now is our colleagues. We will provide all the support necessary as we consult with them about the best way to protect the future of Haribo in the UK."
Yvette Cooper, MP for Normanton, Pontefract and Castleford, described the news as "grim" and said the area needed urgent help from the Government to see how jobs can be saved.
Haribo is a really important employer in Pontefract, with a hard-working workforce who have kept going throughout the Covid crisis, which makes it even more of a blow for the town and for everyone who works there. Wakefield Council have already put a team in place to help support the workforce but we also need urgent help from the Government
Liberal Democrat Parliamentary Spokesperson for Normanton, Pontefract & Castleford, Councillor Tom Gordon, has called for action from the Local Authority, Unions, and MP.
He said Haribo's Managing Director had agreed to speak with him next week.
A number of residents have already been in touch and are deeply worried about what this means for them and their families. We need to make sure we do all that we can in these circumstances and try to ensure we reach the best possible outcome for those employees who are facing redundancy in the middle of a global health crisis.